plan de financiamiento de codelcoprontus.codelco.cl/prontus_codelco/site/artic/20171010/...effective...

CODELCOCorporate PresentationMarch 2021

Copyrights © 2021 Codelco Chile. Todos los Derechos Reservados. | Copyrights © 2021 by Codelco Chile. All Rights Reserved. 2www.codelco.com

Disclaimer

This presentation does not constitute a prospectus, and nothing in this presentation is intended to be taken by, or should be taken by, you as investment advice, a recommendation to buy, hold or sellany security, or an offer to sell or a solicitation of offers to purchase any security in any jurisdiction, including the United States, in which it is unlawful to make an offer or solicitation. Such an offer orsolicitation can only be made in the U.S. by way of an effective registration statement or prospectus in accordance with the applicable securities laws.

The information contained in this presentation has not been independently verified. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness,accuracy, completeness or correctness of the information or the opinions contained herein. The information set forth herein does not purport to be complete, should be considered in the context ofthe circumstances prevailing at the time, and CODELCO is not responsible for any error and/or omissions with respect to the information contained herein. None of CODELCO or any of its respectiveaffiliates shall have any liability whatsoever (in negligence or otherwise), for any loss howsoever arising from any use of this presentation, its contents or otherwise arising in connection with it.

This presentation includes ‘forward-looking statements’, containing the words “anticipate”, “believe”, “intend”, “estimate”, “expect” and other words of similar meaning. All statements other thanhistorical facts covered in this presentation, including, without limitation, those regarding CODELCO’s financial position, business strategy, plans and objectives of management for future operations(including development plans and objectives related to CODELCO’s products and services), industry trends and the environment in which CODELCO operates, are forward-looking statements. Suchforward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of CODELCO to bematerially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerousassumptions regarding CODELCO’s present and future business strategies, future events and industry trends that may affect CODELCO’s business and the environment in which CODELCO will operatein the future. These forward-looking statements speak only as at the date of this presentation, and CODELCO expressly disclaims any obligation or undertaking to disseminate any updates orrevisions to any forward-looking statements contained herein, to reflect any change in CODELCO’s expectations with regard thereto or any change in events, conditions or circumstances on which anyof such statement is based.

As an industry standard, Codelco divides its mineral holdings into two categories, reserves and resources. Resources are ore bodies of economic value that have been identified and evaluatedthrough exploration, reconnaissance and sampling. Reserves are the portion of the resource that can be extracted based on an economic, environmental and technological analysis set forth in themining plan. Reserves and resources are both subdivided further, based on the degree of knowledge that Codelco has of their extent and composition. The system used by Codelco for categorizingmineral ore is according to the Chilean law (N° 20.235), which is in accordance with other systems widely used within the mining industry. The “Comisión Calificadora de Competencias en Recursos yReservas Mineras” is the independent Chilean entity who regulates this and it is part of the Committee for Mineral Reserves International Reporting Standards (CRISCO).

The non-GAAP financial measures included in this presentation (including, without limitation, Adjusted EBIT, Adjusted EBITDA, cash cost, total costs and expenses and financial debt) are not GAAPmeasures of our liquidity and operating performance and should not be considered alternatives to cash flow from operating activities as a measure of liquidity or net income or operating income asmeasures of operating performance or any other measure derived in accordance with GAAP. The Company has prepared reconciliations of comparable GAAP to Non-GAAP measures in tablesincluded at the end of this presentation.


CODELCOOverview


copper producer worldwide 2020

top ratedmining companyS&P / Moody’s / Fitch

2020 2020

6% of global copper reserves

2020

Codelco is Chile’s state-owned copper producer since 1971

2020


CHUQUICAMATAPOTRERILLOSCALETONESVENTANAS

SMELTERS

SALVADOR

COPPER OUTPUT

56 KT2020

GABRIELA MISTRAL

COPPER OUTPUT

102 KT2020

ANDINA

COPPER OUTPUT

184 KT2020

MINISTROHALES

COPPER OUTPUT

171 KT2020

CHUQUI-CAMATA

COPPER OUTPUT

401 KT2020

RADOMIROTOMIC

COPPER OUTPUT

261 KT2020

EL TENIENTE

COPPER OUTPUT

443 KT2020

EL ABRAANGLO AM. SUR

109KTATTRIBUTED, 2020

AFFILIATED COMPANIES

Codelco operates seven mines and four smelters, all located in Chile

CALAMACOPIAPÓ

SANTIAGO

Mining operation

Smelter

Minority stakes


Highlights 2020

Effective implementation of Covid-19 action plan

Increase of own production to 1,618 ktons (+1.9% YoY). Total production1

reached 1,727 ktons (+1.2% YoY)

Significant reduction of C1 cash cost to c$129/pound from c$142/pound in 2019

EBITDA amounted to US$5.3 billion (+30.8% YoY) and Net Debt-to-EBITDA ratio declined to 3.1x

Focus on ESG: Released 5 sustainable development commitments by 2030

Construction of structural projects steadily progressing. Rajo Inca project approved in Jan-2021

1 Total production includes minority stakes in AAS and El Abra


Reduce 60% of our Water

Footprint

Reduce 70% of our Carbon Footprint

Recycling 65% of Industrial

Waste

New Tailings Storage Facility

Standard

Create Additional

Social Value

Sustainability is a key driver of our decisionsFive commitments of sustainable development by 2030

Implement 100% renewable energy matrix and e-Mobility, among others

Incorporate a desalination plant and increase water recycling

Recycle mine truck tires and solid waste from operations and projects

Online monitoring of TSF physical and chemical stability

Increase by 60% goods and services supplied by local suppliers and local workforce


Covid-19: Action PlanEmployee Health & Safety and Operational Continuity


Employee safety and operational continuity are our top priorities

We have a Covid-19 specially-dedicated organizational structure across our operations that maintains an ongoing monitoring

Social distancing measures and temporary suspension of projects did not have a material impact on production in 2020

Alignment of employees with a common safety goal has been key in the effectiveness of the fight against Covid-19 and production performance

Health authorities, Pontificia Universidad Catolica de Chile and McKinsey support our monitoring and provide advice regarding measures


Fight against Covid-19 continues in 2021

Cumulative infected cases total 5,886 people. 5,671 people have already recovered. As of February 22nd, 2021, there are 197 active cases

We have intensified our TTI strategy (Testing-Tracing-Isolating) which allows us to prevent, through early detection, the spread of infections

Our testing rate is, on average, 28x the testing rate of the regions where our operations are located

In 2021, the Covid-19 Action Plan measures are successfully managing the risk of infection among our employees


Copper MarketMain Drivers: Short and Long Term Views


Strong demand from China in 2020 and similar outlook for 2021

Green-led economic recovery in 2021 and coming years

Declining impact of Covid-19 on global economy because of vaccination efforts

Potential supply-side disruptions and cutbacks

Expectations of higher inflation and weaker USD

Copper is off the charts compared to recent years

2016-2021 copper price and stocks*

* Data until 25/02/2020; London Metal Exchange.

100

250

400

550

700

850

1000

180

220

260

300

340

380

420

Jan-16 Jan-17 Jan-18 Jan-19 Jan-20 Jan-21

2020 average:280 ¢/lb




c/lb


tons


0

5

10

15

20

25

30

35

40

45

2019 2040

Construction Power Grid Industrial

Transport Consumer & others

27%

28%

11%

21% 9%

28%

20%

16%

27%

Demand projections reflect stable long-term growth

0

5

10

15

20

25

30

35

40

45

22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40

China U.S. Europe Asia Excl.China Others

2022-2040: CAGR: 1.6%

Refined Consumption by Region(Mt)

Total Consumption by Industry(Mt)

13%

Source: Wood Mackenzie


Codelco: Recent PerformanceProduction & Financial Results


Frequency Rate – Employees & Contractors (Lost time injury / Million hours worked)

Severity Rate – Employees & Contractors (Lost days & days charged / Million hours worked)

SEVERITY RATEIn June 2020, a fatal accident occurred at

Radomiro Tomic, which resulted in the death

of a contractor. We deeply regret this accident

FREQUENCY RATEThe accident frequency rate increased in 2020,

but remained among the lowest rates in recent

years

Employee health and safety remain our top priorities

128

0

100

200

300

400

500

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

0.83

0.50

0.80

1.10

1.40

1.70

2.00

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020


Despite the pandemic, we reached 2020 production and cost targets

0

500

1,000

1,500

2019 2020

Kt

Own production Codelco's stake in El Abra and AAS

1,706

+ 1.2%

50

150

250

350

450

1Q 2Q 3Q 4Q

Kt

2019 2020

342 368361

+ 5.6% + 4.1%

383 410 469422

+ 2.9%

453

- 3,3%

Copper Production Quarterly Production

129.4

141.6

110

125

140

2019 2020

c/lb

27%

25%16%

11%

11%

6% 4%El Teniente

Chuquicamata

Radomiro Tomic

Andina

Ministro Hales

Gabriela Mistral

Salvador

C1 Cash Cost Own production by operation

1,727


Summary of financial results 2020

0

4,500

9,000

13,500

2019 2020

$m$14,173

+ 13.2%

Higher prices and production volume had a positive impact on revenues and margins

Revenues EBITDA

4.0

3.1

1.0

2.0

3.0

4.0

5.0

2019 2020

Times

Net Financial Debt Net Financial Debt-to-EBITDA ratio

$12,525

2019 2020

0

1,500

3,000

4,500

$m

$4,043

$5,289

+ 30.8%

2019 2020

0

5,000

10,000

15,000

20,000

$m

$16,221 $16,171


62%

5%

33%

Cathodes

Anodes-Blister

Concentrates

Copper sales volume breakdown by product and end-market in 2020

38%

13%12%

14%

22%

1%China

Rest of Asia

Europe

N. America

S. America

Others

Copper sales by productCopper sales by end-market

China continues to be the most relevant market


Looking AheadStructural Projects and Transformation


Codelco’s investment program is key to maintain productionStructural projects account for 3/4 of expected output by 2030

ktmf

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

2000 2005 2010 2015 2020 2025 2030 2035 2040

Projects under construction

Projects under study

TODAY

74%2030

Current Operationswithout Projects

Annual Copper Production


Structural projects extend life of mine of our operationsConstruction and start-up periods

SalvadorRajo Inca

Radomiro TomicSulfides II

AndinaFuture Development (Expansion)

2019 - 2023 2024 - 2028 2029 - 2033 2034 - 2038 2039 - 2043

50 ktCuf / year

334 ktCuf / year

2064

2046

2065

LEGEND: Development Under StudyStart-up Start-up

Project

ChuquicamataUnderground Mine 320 ktCuf / year387 ktCuf / year

2057

AndinaMine-Plant Transfer System 201 ktCuf / year 2059200 ktCuf / year

El TenienteNew Mine Level 2072397 ktCuf / year

Life of mine

75 ktCuf / year

311 ktCuf / year

140 ktCuf / year

410 ktCuf / year

Future project production is calculated as the annual average production until 2044. Project construction progress as of Dec-2020

(99.6% Progress)

(93.0% Progress)

(65.3% Progress)


We have reduced debt maturities in the period of intensive Capex

Maintain active management of debt maturity profile

Keep diversifying sources of funding by accessing new markets and investors

(1) As of December 31, 2020 (includes bank debt and bonds)

0

750

1,500

2,250

21 22 23 24 25 26 27 28 29 30 31 32 … 34 35 36 … 39 … 42 43 44 … 47 48 49 50 51

Debt prepayment in Dec-20 Local Bonds Int' Bonds Bank Debt

USD bonds 83%Bank loans 8%

EUR bonds 5%

Local bonds and others 4%

Sources of funding

4.0%RATE

$m (1)

Next steps


$ 1 billionAnnual Opex Savings

The plan targets to position Codelco in the second quartile of the global cash cost curve and optimize the development of our structural projects

on an ongoing basis starting in 2021

$ 8 billion Capex Savings 2019-2028

equivalent to 20% of 10-year Capex plan

We designed a transformation plan that unlocks the value of our reserves


Summary

1. Covid-19 action plan continues to be effective by strengthening our employees health and maintaining operational continuity

2. We maintained our production and cost-reduction targets despite difficulties in 2020 because of the pandemic

3. Improved financial results in 2020 reflect our resiliency during the crisis

4. In 2021, we are well positioned for similar levels of production and to achieve additional cost-reduction targets

5. Structural projects continue progressing as planned, with Salvador Rajo Inca in development phase since Jan-2021

6. Our sustainable development commitments show the relevance of ESG in our strategy and operations


Contact information

Corporate Address:

1270 Huerfanos St.

P.O. Box 150 – D

Santiago, Chile

Phone: (56-2) 2690 3000

Investor Contact:

Alejandro Sanhueza

Head of Finance

Phone: (56-2) 2690 3248

[email protected]

Pablo Lubbert

Investor Relations

Phone: (56-2) 2690 3938

[email protected]


CODELCO

plan de financiamiento de codelcoprontus.codelco.cl/prontus_codelco/site/artic/20171010/...effective...

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